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HomeMy WebLinkAbout2020-05-06; Carlsbad Tourism Business Improvement District; ; 89 ACT MODIFICATION Civitas AdvisorsAB# 05-20-193 MTG. 5-6-20 CTBID STAFF GENERAL COUNSEL 89 ACT MODIFICATION CARLSBAD TOURISM BUSINESS IMPROVEMENT DISTRICT (CTBID) AGENDA BILL RECOMMENDED ACTION: Adopt a resolution authorizing the Chairperson to enter into agreement between the Carlsbad Tourism Business Improvement District (CTBID) and Civitas Advisors and appropriating additional funding for professional services. ITEM EXPLANATION: At its July 17, 2019 board meeting, the Carlsbad Tourism Business Improvement District (CTBID) Board appointed a 3-member temporary advisory committee to work on a strategic growth plan for the CTBID. The advisory committee made up of Board Members Hughes, Rauch and Gray, has been working since then to determine whether the assessment should be increased. Based on their recommendation, the Board entered into an agreement with Civitas Advisors to advise in this effort in November 2019. Based on the initial work done by Civitas Advisors and the recent developments due to Covid- 19, the timeline and scope of the project has been modified. Based on direction from the advisory committee, Civitas has provided a new proposal to modify the 89 Act District to allow for a change in the assessment methodology from a fixed dollar to a percentage of gross sales. The proposal also includes their assistance in the transition of the CTBID Advisory board to a leadership position of Visit Carlsbad. See attached proposal at Exhibit 1. If the CTBID Board approves the recommendation of the advisory committee, they should adopt a resolution authorizing the Chairperson to enter into agreement between the Carlsbad Tourism Business Improvement District (CTBID) and Civitas Advisors and appropriate $20,000 from fund balance. FISCAL IMPACT: The CTBID has $640,000 in reserves that is available to be appropriated for this service. ENVIRONMENTAL IMPACT: This action does not qualify as a project under the California Environment Quality Act ("CEQA") and will not have a physical adverse effect on the environment. (CEQA Guideline 15378(b).) EXHIBITS: 1. Civitas Advisors proposal 2. Resolution authorizing the Chairperson to enter into an agreement between the Carlsbad Tourism Business Improvement District (CTBID) and Civitas Advisors and appropriating additional funding for these professional services. A. Civitas Advisor's contract T dIHIHX CARLSBAD TBID 89 ACT MODIFICATION PROPOSAL Tim Stripe, Board Chair Carlsbad Tourism Business Improvement District Dear Mr. Stripe, I am pleased to present to you our enclosed proposal for services to renew and modify the CarlsbadTourism Tourism Business Improvement District ("TBID"), a Tourism Business Improvement District ("TBID") established under the Parking and Business Improvement Area act of 1989 ("89 Act"), to allow for an assessment modification during the 2020/2021 term for the Carlsbad TBID. Additionally, Civitas will assist the CTBID Advisory Board, the City of Carlsbad, and Visit Carlsbad ("VC") on best practices to transition the leadership of the CTBID Advisory Board to the CCVB Board. Thank you for the opportunity to submit this proposal. I look forward to working with you on this exciting project. Best Regards, -11A-vvou-ra Nichole Farley, Director of Business Development Civitas I Carlsbad Tourism Business Improvement District 1 I Carlsbad Tourism Business Improvement District 21 THE OPPORTUNITY In our recent project to convert the CTBID from an 89 Act district to a district established under the Property and Business Improvement District Law of 1994, the CTBID Advisory Board decided not to pursue the district conversion at this time but would like to continue with the ability to modify the 89 Act TBID to allow for an change in the assessment methodology from a fixed dollar to a percentage of gross sales. It has also been discussed that this is an opportunity to work with the VC Board to transition the CTBID Advisory Board into a leadership position of the VC to help reduce administration efforts and improve efficiency for management of the TBID assessment funding. Civitas has successfully completed over 150 special assessment district formation and renewal projects throughout the world which has generated over $1.7 billion in dedicated funding for the specific needs of our clients. Our client portfolio ranges from destinations seeking to establish themselves in the market for the first time to iconic, long standing destinations that wish to remain competitive and further cement their legacy in the industry. Renew Current Tourism Business Improvement District Civitas will assist in the renewal of the current Tourism Business Improvement District under the 89 Act with a shortened term. Form a new Tourism Business Improvement District under the 89 Act Civitas with guide the CTBID and the City of Carlsbad through the necessary steps required by the 89 Act to create a new 89 Act TBID with the proposed new assessment methodology. This will include drafting all the required resolutions, staff reports, and public notices. Modify 89 Act Tourism Business Improvement District Ordinance Civitas will guide the CTBID and the City of Carlsbad through the necessary steps to modify the current CTBID Ordinance from a fixed rate assessment methodology to a percentage of gross room night sales assessment methodology. This step will include drafting the new Ordinance, related staff reports, and public notices. 89 Act Advisory Board and VC Board Integration Civitas will work with the CTBID Advisory Board and the VC Board to conduct a review of the VC Bylaws and provide recommendations on how to consolidate the CTBID Advisory Board and the VC Board. SCOPE OF SERVICES r: SCHEDULE Civitas I Carlsbad Tourism Business Improvement District 3 MEET YOUR TEAM Civitas is a leader in developing long term funding solutions for Destination Marketing Organizations. We have helped several states investigate the potential of establishing statewide funding, in addition to assisting in the formation of an unparalleled ninety-nine TBIDs throughout the United States. With its deep experience and expertise, Civitas has been commissioned by the U.S. Travel Association to conduct nationwide studies. John Lambeth President & CEO Nichole Farley Director of Business Development & Client Engagement Civitas also provides research, consulting, and district formation services to destinations located around the world, including Canada, South America, Europe, and Asia. A representative distant high-priced destination is Japan, where Civitas clients include Nomura Research Institute, Japan Area-Based Management Organization Network, Japan Travel Bureau, and Setouchi Tourism Authority. For its groundbreaking work, Civitas has been featured in publications such as Forbes and Skift. Gina Reed Project Manager Madison Deschamps Legal Assistant Carlsbad Tourism Business Improvement Di INVESTMENT PROVISIONS Investment This proposal is based on the understanding that CTBID Board will provide assistance and time needed to facilitate the process on the local level, including time devoted to outreach meetings, and gathering support for the ordinance modification. The CTBID's investment for the scope of services and timeline described herein shall be $20,000. At this time, no trips to Carlsbad are included in this proposal. If a trip is requested, a member of the Civitas team would be happy to make a trip for $1,250 in professional fees plus expenses, with travel days billed at 50%. Expenses CTBID will be responsible for all costs and expenses in addition to the professional fees. Ordinary costs and expenses, including telephone charges, postage, and photocopying will be billed at four percent (4%) of professional fees. Other costs, such as travel, overnight shipping, bulk mailing and printing costs (over 100 pages) shall be billed at Civitas' actual cost. Expenses are not expected to exceed $2,000. Investment Overview Description Price Professional Fees $18,000 Estimated Expenses $2,000 Billing Civitas proposes a fixed monthly fee of $6,000 per month for three (3) months, plus expenses. A start-up fee of ten percent (10%) of project costs, $2,000, will be due and payable upon execution of an agreement for services between Civitas and CTBID. The amount of the start-up fee will be deducted from the final invoice, which will also be adjusted to account for the total contract price. Civitas will send CTBID a monthly invoice for fees and costs incurred. Invoices will include the fixed professional fee and expenses. The basis of calculation or other method of determining expenses will be clearly identified by item and amount. Civitas I Carlsbad Tourism Business Improvement District 5 Cost Assumptions and Guidelines We have projected a specific amount of time to complete the TBID renewal and modification, along with the VC Board conversion. It is assumed that the project will not exceed the budgeted amount of time. If unanticipated matters result in additional time beyond that which has been projected, we would continue billing professional fees of $6,000 per month, plus expenses, for the project duration. Factors that could increase the scope of work and estimated costs outlined above include additional meetings not described in this proposal, analysis of additional issues above those described in this proposal, or a lack of steering committee and business owner involvement in the project. When Civitas' services conclude, all unpaid charges will immediately become due and payable. The amount of professional fees set forth in this agreement are a fixed amount for completion of the project within a maximum three (3) month time frame. The total amount of professional fees has been divided over the maximum three (3) month time frame to determine the monthly billing amount. If the project is completed prior to the three (3) month time frame, the remaining balance of professional fees will be due and payable within thirty (30) days of project completion. As you know, there are many unknown variables in a project of this nature. Although we would work diligently to complete the project, factors outside Civitas and the CTBID's control could delay or thwart even the best-developed plans. We will work to minimize risks and complete the project at the earliest possible date. The pricing and scope outlined in this agreement will expire upon sixty (60) days post delivery of this proposal. Business Improvement District 6 AGREEMENT If you would like to agree to engage our services consistent with this proposal and the following terms, please sign below. A start-up fee of ten percent (10%) of project costs, $2,000, will be due and payable upon execution of this Agreement. Civitas will send CTBID a monthly invoice for fees and costs incurred. Each invoice will be payable within thirty (30) days of its mailing date. Either CTBID or Civitas shall have the right to terminate this agreement upon ten (10) days' notice. When Civitas' services conclude, all unpaid charges will immediately become due and payable, including the balance of any professional fees if the project is completed prior to the maximum three (3) month time frame. Nothing in this Agreement and nothing in statements by Civitas personnel to CTBID will be construed as a promise or guarantee about the outcome of the matter. Civitas makes no such promises or guarantees. If any provision of this Agreement is held in whole or in part to be unenforceable for any reason, the remainder of that provision and of the entire Agreement will be severable and remain in effect. This Agreement may be modified by subsequent agreement of the parties only by an instrument in writing signed by both of them or an oral agreement only to the extent that the parties carry it out. The parties agree to accept the terms and conditions herein. Carlsbad Tourism Business Improvement District, by Not yet submitted Tim Stripe, Board Chair Civitas Advisors, by Date 4-24-2020 c. Date John Lambeth, President & CEO Civitas I Carlsbad Tourism Business Improvement District 7 DocuSign Envelope ID: B10E1C24-9845-491D-AF42-FE9F2186EFF8 EXHIBIT 2 RESOLUTION NO. 2020-3 RESOLUTION OF THE BOARD OF DIRECTORS OF THE CARLSBAD TOURISM BUSINESS IMPROVEMENT DISTRICT AUTHORIZING THE CHARIPERSON TO EXECUTE AN AGREEMENT FOR PROFESSIONAL SERVICES WITH CIVITAS ADVISORS WHEREAS, on November 15, 2005, the City Council of the City of Carlsbad adopted Ordinance No. NS-778 enacting Chapter 3.37 of the Carlsbad Municipal Code and creating the Carlsbad Tourism Business Improvement District (CTBID); and WHEREAS, the primary purpose of the CTBID is to promote tourism and provide services to visitors to the City of Carlsbad: and WHEREAS, the City of Carlsbad has authorized the Board of Directors (Board) of the CTBID to conduct the business of the CTBID in the time, place and manner that best suits the needs of the Board, subject to the control of the federal, state and local laws governing the activities of a Business Improvement District; and WHEREAS, the City Council has provided the Board with the ability to contract for services necessary to carry out the purpose of the CTBID; and WHEREAS, Civitas Advisors, by virtue of their extensive experience in developing long- term funding for Destination Marketing Organizations, is uniquely qualified to provide professional services to the CTBID; and WHEREAS, it is estimated that the cost to provide these services is $20,000; and NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Carlsbad Tourism Business Improvement District, as follows: 1. That the above recitations are true and correct. 2. That the Board authorizes the Board Chairperson to execute the attached agreement with Civitas Advisors (Exhibit 2A) to provide professional services to explore options to modify the current CTBID assessment in an amount not to exceed $20,000. 3. That $20,000 be appropriated from the CTBID Fund Balance to Miscellaneous Professional Services for Civitas Advisors contract. DocuSign Envelope ID: B10E1C24-9B45-491D-AF42-FE9F2186EFF8 EXHIBIT 2 PASSED, APPROVED, AND ADOPTED at a regular meeting of the Board of Directors of the Carlsbad Tourism Business Improvement District on the 6th day of May 2020, by the following vote to wit: AYES: Stripe, Canepa, Rauch, Gray, Hughes, Chapin NOES: None. ABSENT: None. Psi grip(' TIM STRIPE Chair ATTEST: BARBARA ENGLESON Pro Tem Clerk of the Carlsbad Tourism Business Improvement District 1/e(71/7 Gorne2 / Dept'," ci EXHIBIT 2A AGREEMENT FOR 89 ACT MODIFICATION SERVICES WITH CIVITAS ADVISORS HIS AGREEMENT i made and entered into as of the 54'Idk day of , 20 , by and between the Carlsbad Tourism Business lmprovemeht District (CTBID), and Civitas Advisors, a for-profit, private organization ("Contractor"). RECITALS A. CTBID requires the professional services of a contractor that is experienced in assessment modification services. B. Contractor has the necessary experience in providing professional services and advice related to assessment modification. C. Selection of Contractor is expected to achieve the desired results in an expedited fashion. D. Contractor has submitted a proposal to CTBID and has affirmed its willingness and ability to perform such work. NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, CTBID and Contractor agree as follows: 1. SCOPE OF WORK CTBID retains Contractor to perform, and Contractor agrees to render, those services (the "Services") that are defined in attached Exhibit "A", which is incorporated by this reference in accordance with this Agreement's terms and conditions. 2. STANDARD OF PERFORMANCE While performing the Services, Contractor will exercise the reasonable professional care and skill customarily exercised by reputable members of Contractor's profession practicing in the Metropolitan Southern California Area, and will use reasonable diligence and best judgment while exercising its professional skill and expertise. 3. TERM The term of this Agreement will be effective for a period of six (6) months from the date of the agreement. 4. TIME IS OF THE ESSENCE Time is of the essence for each and every provision of this Agreement. CTBID Attorney Approved Version #05.06.08 1 5. COMPENSATION The total not to exceed fee payable for the Services to be performed during the initial Agreement term shall not exceed Twenty Thousand dollars ($20,000). No other compensation for the Services will be allowed except for items covered by subsequent amendments to this Agreement. The CTBID reserves the right to withhold a ten percent (10%) retentio'6,until CTBID has accepted the work and/or Services specified in Exhibit flAll Compensation will be made in three (3) monthly installments of Six Thousand dollars ($6,000) each month, plus initial start-up fees of $2,000, for a not to exceed amount of $20,000. The first installment and the initial start-up fees shall be payable upon execution of the Agreement. Subsequent installments shall be paid in the first full week of each month, through the term of this Agreement. Subsequent installments will be adjusted based on the approved actual expenses from the prior month. Adjustments to pay dates may be necessary due to the cash balance in the fund. The CTBID reserves the right to terminate or reduce funding levels outlined in the Agreement in the event of CTBID revenue reductions. Recommended deductions will be reported to the CTBID Board who shall determine the modified funding level. 6. STATUS OF CONTRACTOR Contractor will perform the Services in Contractor's own way as an independent contractor and in pursuit of Contractor's independent calling, and not as an employee of CTBID. Contractor will be under control of CTBID only as to the result to be accomplished, but will consult with CTBID as necessary. The persons used by Contractor to provide services under this Agreement will not be considered employees of CTBID for any purposes. The payment made to Contractor pursuant to the Agreement will be the full and complete compensation to which Contractor is entitled. CTBID will not make any federal or state tax withholdings on behalf of Contractor or its agents, employees or subcontractors. CTBID will not be required to pay any workers' compensation insurance or unemployment contributions on behalf of Contractor or its employees or subcontractors. Contractor agrees to indemnify CTBID within thirty (30) days for any tax, retirement contribution, social security, overtime payment, unemployment payment or workers' compensation payment which CTBID may be required to make on behalf of Contractor or any agent, employee, or subcontractor of Contractor for work done under this Agreement. At the CTBID's election, CTBID may deduct the indemnification amount from any balance owing to Contractor. 7. SUBCONTRACTING Contractor will not subcontract any portion of the Services without prior written approval of CTBID. If Contractor subcontracts any of the Services, Contractor will be fully responsible to CTBID for the acts and omissions of Contractor's subcontractor and of the persons either directly or indirectly employed by the subcontractor, as Contractor is for CTBID Attorney Approved Version #05.06.08 2 the acts and omissions of persons directly employed by Contractor. Nothing contained in this Agreement will create any contractual relationship between any subcontractor of Contractor and CTBID. Contractor will be responsible for payment of subcontractors. Contractor will bind every subcontractor and every subcontractor of a subcontractor by the terms of this Agreement applicable to Contractor's work unless specifically noted to the contrary in the subcontract and approved in writing by CTBID. 8. OTHER CONTRACTORS The CTBID reserves the right to employ other Contractors in connection with the Services. 9. INDEMNIFICATION Contractor agrees to indemnify and hold harmless the CTBID and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses including attorneys fees arising out of the performance of the work described herein caused by any negligence, recklessness, or willful misconduct of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable. The parties expressly agree that any payment, attorney's fee, costs or expense CTBID incurs or makes to or on behalf of an injured employee under the CTBID's self- administered workers' compensation is included as a loss, expense or cost for the purposes of this section, and that this section will survive the expiration or early termination of this Agreement. 10. INSURANCE Contractor will obtain and maintain for the duration of the Agreement and any and all amendments, insurance against claims for injuries to persons or damage to property which may arise out of or in connection with performance of the services by Contractor or Contractor's agents, representatives, employees or subcontractors. The insurance will be obtained from an insurance carrier admitted and authorized to do business in the State of California. The insurance carrier is required to have a current Best's Key Rating of not less than "A-:VII". OR with a surplus line insurer on the State of California's List of Eligible Surplus Line Insurers (LESLI) with a rating in the latest Best's Key Rating Guide of at least "AX". 10.1 Coverages and Limits. Contractor will maintain the types of coverages and minimum limits indicated below, unless CTBID Attorney or CTBID Manager approves a lower amount. These minimum amounts of coverage will not constitute any limitations or cap on Contractor's indemnification obligations under this Agreement. CTBID, its officers, agents and employees make no representation that the limits of the insurance specified to be carried by Contractor pursuant to this Agreement are adequate to protect Contractor. If Contractor believes that any required insurance coverage is inadequate, Contractor will CTBID Attorney Approved Version #05.06.08 3 obtain such additional insurance coverage, as Contractor deems adequate, at Contractor's sole expense. 10.1.1 Commercial General Liability Insurance. $1,000,000 combined single-limit per occurrence for bodily injury, personal injury and property damage. If the submitted policies contain aggregate limits, general aggregate limits will apply separately to the work under this Agreement or the general aggregate will be twice the required per occurrence limit. 10.1.2 Automobile Liability (if the use of an automobile is involved for Contractor's work for CTBID). $1,000,000 combined single-limit per accident for bodily injury and property damage. 10.1.3 Workers' Compensation and Employer's Liability. Workers' Compensation limits as required by the California Labor Code. Workers' Compensation will not be required if Contractor has no employees and provides, to CTBID's satisfaction, a declaration stating this. 10.1.4 Professional Liability. Errors and omissions liability appropriate to Contractor's profession with limits of not less than $1,000,000 per claim. Coverage must be maintained for a period of five years following the date of completion of the work. 10.2. Additional Provisions. Contractor will ensure that the policies of insurance required under this Agreement contain, or are endorsed to contain, the following provisions: 10.2.1 The CTBID will be named as an additional insured on General Liability. 10.2.2 Contractor will obtain occurrence coverage, excluding Professional Liability, which will be written as claims-made coverage. 10.2.3 This insurance will be in force during the life of the Agreement and any extensions of it and will not be canceled without thirty (30) days prior written notice to CTBID sent by certified mail pursuant to the Notice provisions of this Agreement. 10.3 Providing Certificates of Insurance and Endorsements. Prior to CTBID's execution of this Agreement, Contractor will furnish certificates of insurance and endorsements to CTBID. 10.4 Failure to Maintain Coverage. If Contractor fails to maintain any of these insurance coverages, then CTBID will have the option to declare Contractor in breach, or may purchase replacement insurance or pay the premiums that are due on existing policies in order to maintain the required coverages. Contractor is responsible for any payments made by CTBID to obtain or maintain insurance and CTBID may collect these payments CTBID Attorney Approved Version #05.06.08 4 from Contractor or deduct the amount paid from any sums due Contractor under this Agreement. 10.5 Submission of Insurance Policies. CTBID reserves the right to require, at any time, complete and certified copies of any or all required insurance policies and endorsements. 11. BUSINESS LICENSE Contractor will obtain and maintain a City of Carlsbad Business License for the term of the Agreement, as may be amended from time-to-time. 12. ACCOUNTING RECORDS Contractor will maintain complete and accurate records with respect to costs incurred under this Agreement. All records will be clearly identifiable. Contractor will allow a representative of CTBID during normal business hours to examine, audit, and make transcripts or copies of records and any other documents created pursuant to this Agreement. Contractor will allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 13. OWNERSHIP OF DOCUMENTS All work product produced by Contractor or its agents, employees, and subcontractors pursuant to this Agreement is the property of CTBID. In the event this Agreement is terminated, all work product produced by Contractor or its agents, employees and subcontractors pursuant to this Agreement will be delivered at once to CTBID. Contractor will have the right to make one (1) copy of the work product for Contractor's records. 14. COPYRIGHTS Contractor agrees that all copyrights that arise from the services will be vested in CTBID and Contractor relinquishes all claims to the copyrights in favor of CTBID. 15. NOTICES The name of the persons who are authorized to give written notices or to receive written notice on behalf of CTBID and on behalf of Contractor under this Agreement. For CTBID: Cheryl Gerhardt CTBID Staff City of Carlsbad 1635 Faraday Ave. Carlsbad, CA 92008 Phone No. 760-602-2468 For Contractor: John Lambeth President & CEO Civitas Advisors 1102 Corporate Way, Suite 140 Sacramento, CA 95831 Phone No. 916-437-4300 5 CTBID Attorney Approved Version #05.06.08 Each party will notify the other immediately of any changes of address that would require any notice or delivery to be directed to another address. 16. RESERVED 17. GENERAL COMPLIANCE WITH LAWS Contractor will keep fully informed of federal, state and local laws and ordinances and regulations which in any manner affect those employed by Contractor, or in any way affect the performance of the Services by Contractor. Contractor will at all times observe and comply with these laws, ordinances, and regulations and will be responsible for the compliance of Contractor's services with all applicable laws, ordinances and regulations. Contractor will be aware of the requirements of the Immigration Reform and Control Act of 1986 and will comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and consultants that the services required by this Agreement. 18. DISCRIMINATION AND HARASSMENT PROHIBITED Contractor will comply with all applicable local, state and federal laws and regulations prohibiting discrimination and harassment. 19. DISPUTE RESOLUTION If a dispute should arise regarding the performance of the Services the following procedure will be used to resolve any questions of fact or interpretation not otherwise settled by agreement between the parties. Representatives of Contractor or CTBID will reduce such questions, and their respective views, to writing. A copy of such documented dispute will be forwarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The representative receiving the letter will reply to the letter along with a recommended method of resolution within ten (10) business days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outlining the disputes will be forwarded to the CTBID Board. The CTBID Board will consider the facts and solutions recommended by each party and may then opt to direct a solution to the problem. In such cases, the action of the CTBID Board will be binding upon the parties involved, although nothing in this procedure will prohibit the parties from seeking remedies available to them at law. CTBID Attorney Approved Version #05.06.08 6 20. TERMINATION In the event of the Contractor's failure to prosecute, deliver, or perform the Services, CTBID may terminate this Agreement for nonperformance by notifying Contractor by certified mail of the termination. If CTBID decides to abandon or indefinitely postpone the work or services contemplated by this Agreement, CTBID may terminate this Agreement upon written notice to Contractor. Upon notification of termination, Contractor has five (5) business days to deliver any documents owned by CTBID and all work in progress to CTBID address contained in this Agreement. CTBID will make a determination of fact based upon the work product delivered to CTBID and of the percentage of work that Contractor has performed which is usable and of worth to CTBID in having the Agreement completed. Based upon that finding CTBID will determine the final payment of the Agreement. Either party upon tendering thirty (30) days written notice to the other party may terminate this Agreement. In this event and upon request of CTBID, Contractor will assemble the work product and put it in order for proper filing and closing and deliver it to CTBID. Contractor will be paid for work performed to the termination date; however, the total will not exceed the lump sum fee payable under this Agreement. CTBID will make the final determination as to the portions of tasks completed and the compensation to be made. 21. COVENANTS AGAINST CONTINGENT FEES Contractor warrants that Contractor has not employed or retained any company or person, other than a bona fide employee working for Contractor, to solicit or secure this Agreement, and that Contractor has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this Agreement. For breach or violation of this warranty, CTBID will have the right to annul this Agreement without liability, or, in its discretion, to deduct from the Agreement price or consideration, or otherwise recover, the full amount of the fee, commission, percentage, brokerage fees, gift, or contingent fee. 22. CLAIMS AND LAWSUITS By signing this Agreement, Contractor agrees that any Agreement claim submitted to CTBID must be asserted as part of the Agreement process as set forth in this Agreement and not in anticipation of litigation or in conjunction with litigation. Contractor acknowledges that if a false claim is submitted to CTBID, it may be considered fraud and Contractor may be subject to criminal prosecution. Contractor acknowledges that California Government Code sections 12650 et seq., the False Claims Act applies to this Agreement and, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If CTBID seeks to recover penalties pursuant to the False Claims Act, it is entitled to recover its litigation costs, including attorney's fees. Contractor acknowledges that the filing of a false claim may subject Contractor to an administrative debarment proceeding as the result of which Contractor may be prevented to act as a Contractor on CTBID Attorney Approved Version #05.06.08 7 any public work or improvement for a period of up to five (5) years. Contractor acknowledges debarment by another jurisdiction is grounds for CTBID to terminate this Agreement. 23. JURISDICTIONS AND VENUE Any action at law or in equity brought by either of the parties for the purpose of enforcing a right or rights provided for by this Agreement will be tried in a court of competent jurisdiction in the County of San Diego, State of California, and the parties waive all provisions of law providing for a change of venue in these proceedings to any other county. This Agreement shall be interpreted pursuant to the laws of the State of California. 24. SUCCESSORS AND ASSIGNS It is mutually understood and agreed that this Agreement will be binding upon CTBID and Contractor and their respective successors. Neither this Agreement or any part of it nor any monies due or to become due under it may be assigned by Contractor without the prior consent of CTBID, which shall not be unreasonably withheld. 25. ENTIRE AGREEMENT This Agreement, together with any other written document referred to or contemplated by it, along with the purchase order for this Agreement and its provisions, embody the entire Agreement and understanding between the parties relating to the subject matter of it. In case of conflict, the terms of the Agreement supersede the purchase order. Neither this Agreement nor any of its provisions may be amended, modified, waived or discharged except in a writing signed by both parties. /// /// CTBID Attorney Approved Version #05.06.08 8 *B v: hn Lambeth, President & CEO **By: !vitas Advisors By: Neciar- 6-Ome2, Pept. Tim S ATTEST: , CTBID Board Chair Barbara Engleson Clerk of CTBID 26. AUTHORITY The individuals executing this Agreement and the instruments referenced in it on behalf of Contractor each represent and warrant that they have the legal power, right and actual authority to bind Contractor to the terms and conditions of this Agreement. CONTRACTOR Carlsbad Tourism Business Improvement District If required by CTBID, proper notarial acknowledgment of execution by contractor must be attached. If a Corporation, Agreement must be signed by one corporate officer from each of the following two groups. *Group A. **Group B. Chairman, Secretary, President, or Assistant Secretary, Vice-President CFO or Assistant Treasurer Otherwise, the corporation must attach a resolution certified by the secretary or assistant secretary under corporate seal empowering the officer(s) signing to bind the corporation. APPROVED AS TO FORM: CELIA A. BREWER, General Counsel to CTBID By: Assistant General Counsel CTBID Attorney Approved Version #05.06.08 9 V IIUIHXa CARLSBAD TBID 89 ACT MODIFICATION PROPOSAL Tim Stripe, Board Chair Carlsbad Tourism Business Improvement District Dear Mr. Stripe, I am pleased to present to you our enclosed proposal for services to renew and modify the CarlsbadTourism Tourism Business Improvement District ("TBID"), a Tourism Business Improvement District ("TBID") established under the Parking and Business Improvement Area act of 1989 ("89 Act"), to allow for an assessment modification during the 2020/2021 term for the Carlsbad TBID. Additionally, Civitas will assist the CTBID Advisory Board, the City of Carlsbad, and Visit Carlsbad ("VC") on best practices to transition the leadership of the CTBID Advisory Board to the CCVB Board. Thank you for the opportunity to submit this proposal. I look forward to working with you on this exciting project. Best Regards, -11miNd-Q-Fzu-bus Nichole Farley, Director of Business Development Civitas I Carlsbad Tourism Business Improvement District 1 I Carlsbad Tourism Business Improvement District 21 THE OPPORTUNITY In our recent project to convert the CTBID from an 89 Act district to a district established under the Property and Business Improvement District Law of 1994, the CTBID Advisory Board decided not to pursue the district conversion at this time but would like to continue with the ability to modify the 89 Act TBID to allow for an change in the assessment methodology from a fixed dollar to a percentage of gross sales. It has also been discussed that this is an opportunity to work with the VC Board to transition the CTBID Advisory Board into a leadership position of the VC to help reduce administration efforts and improve efficiency for management of the TBID assessment funding. Civitas has successfully completed over 150 special assessment district formation and renewal projects throughout the world which has generated over $1.7 billion in dedicated funding for the specific needs of our clients. Our client portfolio ranges from destinations seeking to establish themselves in the market for the first time to iconic, long standing destinations that wish to remain competitive and further cement their legacy in the industry. Renew Current Tourism Business Improvement District Civitas will assist in the renewal of the current Tourism Business Improvement District under the 89 Act with a shortened term. Form a new Tourism Business Improvement District under the 89 Act Civitas with guide the CTBID and the City of Carlsbad through the necessary steps required by the 89 Act to create a new 89 Act TBID with the proposed new assessment methodology. This will include drafting all the required resolutions, staff reports, and public notices. Modify 89 Act Tourism Business Improvement District Ordinance Civitas will guide the CTBID and the City of Carlsbad through the necessary steps to modify the current CTBID Ordinance from a fixed rate assessment methodology to a percentage of gross room night sales assessment methodology. This step will include drafting the new Ordinance, related staff reports, and public notices. 89 Act Advisory Board and VC Board Integration Civitas will work with the CTBID Advisory Board and the VC Board to conduct a review of the VC Bylaws and provide recommendations on how to consolidate the CTBID Advisory Board and the VC Board. SCOPE OF SERVICES SCHEDULE CiVii051 Carlsbad Tourism Business Improvement District 3 MEET YOUR TEAM „• John Lambeth President & CEO Gina Reed Project Manager Nichole Farley Director of Business Development & Client Engagement Madison Deschamps Legal Assistant Civitas is a leader in developing long term funding solutions for Destination Marketing Organizations. We have helped several states investigate the potential of establishing statewide funding, in addition to assisting in the formation of an unparalleled ninety-nine TBIDs throughout the United States. With its deep experience and expertise, Civitas has been commissioned by the U.S. Travel Association to conduct nationwide studies. Civitas also provides research, consulting, and district formation services to destinations located around the world, including Canada, South America, Europe, and Asia. A representative distant high-priced destination is Japan, where Civitas clients include Nomura Research Institute, Japan Area-Based Management Organization Network, Japan Travel Bureau, and Setouchi Tourism Authority. For its groundbreaking work, Civitas has been featured in publications such as Forbes and Skift. 'Pkr111.111111,1,111115•••^•^. I Carlsbad Tourism Business Improvemen INVESTMENT PROVISIONS Investment Overview Description Price Professional Fees $18,000 Estimated Expenses $2,000 Total $20,000 Civitas proposes a fixed monthly fee of $6,000 per month for three (3) months, plus expenses. A start-up fee of ten percent (10%) of project costs, $2,000, will be due and payable upon execution of an agreement for services between Civitas and CTBID. The amount of the start-up fee will be deducted from the final invoice, which will also be adjusted to account for the total contract price. Civitas will send CTBID a monthly invoice for fees and costs incurred. Invoices will include the fixed professional fee and expenses. The basis of calculation or other method of determining expenses will be clearly identified by item and amount. This proposal is based on the understanding that CTBID Board will provide assistance and time needed to facilitate the process on the local level, including time devoted to outreach meetings, and gathering support for the ordinance modification. The CTBID's investment for the scope of services and timeline described herein shall be $20,000. At this time, no trips to Carlsbad are included in this proposal. If a trip is requested, a member of the Civitas team would be happy to make a trip for $1,250 in professional fees plus expenses, with travel days billed at 50%. Expenses CTBID will be responsible for all costs and expenses in addition to the professional fees. Ordinary costs and expenses, including telephone charges, postage, and photocopying will be billed at four percent (4%) of professional fees. Other costs, such as travel, overnight shipping, bulk mailing and printing costs (over 100 pages) shall be billed at Civitas' actual cost. Expenses are not expected to exceed $2,000. Civitas I Carlsbad Tourism Business Improvement District 5 Cost Assumptions and Guidelines We have projected a specific amount of time to complete the TBID renewal and modification, along with the VC Board conversion. It is assumed that the project will not exceed the budgeted amount of time. If unanticipated matters result in additional time beyond that which has been projected, we would continue billing professional fees of $6,000 per month, plus expenses, for the project duration. Factors that could increase the scope of work and estimated costs outlined above include additional meetings not described in this proposal, analysis of additional issues above those described in this proposal, or a lack of steering committee and business owner involvement in the project. When Civitas services conclude, all unpaid charges will immediately become due and payable. The amount of professional fees set forth in this agreement are a fixed amount for completion of the project within a maximum three (3) month time frame. The total amount of professional fees has been divided over the maximum three (3) month time frame to determine the monthly billing amount. If the project is completed prior to the three (3) month time frame, the remaining balance of professional fees will be due and payable within thirty (30) days of project completion. As you know, there are many unknown variables in a project of this nature. Although we would work diligently to complete the project, factors outside Civitas and the CTBID's control could delay or thwart even the best-developed plans. We will work to minimize risks and complete the project at the earliest possible date. The pricing and scope outlined in this agreement will expire upon sixty (60) days post delivery of this proposal. Business Improvement District 6 AGREEMENT If you would like to agree to engage our services consistent with this proposal and the following terms, please sign below. A start-up fee of ten percent (10%) of project costs, $2,000, will be due and payable upon execution of this Agreement. Civitas will send CTBID a monthly invoice for fees and costs incurred. Each invoice will be payable within thirty (30) days of its mailing date. Either CTB ID or Civitas shall have the right to terminate this agreement upon ten (10) days' notice. When Civitas' services conclude, all unpaid charges will immediately become due and payable, including the balance of any professional fees if the project is completed prior to the maximum three (3) month time frame. Nothing in this Agreement and nothing in statements by Civitas personnel to CTBID will be construed as a promise or guarantee about the outcome of the matter. Civitas makes no such promises or guarantees. If any provision of this Agreement is held in whole or in part to be unenforceable for any reason, the remainder of that provision and of the entire Agreement will be severable and remain in effect. This Agreement may be modified by subsequent agreement of the parties only by an instrument in writing signed by both of them or an oral agreement only to the extent that the parties carry it out. The parties agree to accept the terms and conditions herein. Carlsbad Tourism Business Improvement District, by Not yet submitted Tim Stripe, Board Chair Civitas Advisors, by Date 4-24-2020 Date John Lambeth, President & CEO Civitas I Carlsbad Tourism Business Improvement District 7